Saddam Hussein built a secret torture dungeon and execution chamber in the heart of New York City and even shipped the bodies of his victims out of the country using diplomatic immunity, insiders say.

On taking control of Iraq in 1979, the dictator installed a 'detention room' in the basement of the country's Permanent Mission building in Manhattan's Upper East Side.

There, sources told the NY Post, Iraqi civilians were held in detention, subjected to gruesome torture and even murdered - just across the road from Michael Bloomberg, who would later become the city's mayor.

The detention room was equipped with sturdy doors that were near-impossible to break in or out of, and buried so deep that victims' screams could not be heard.

In that terrifying dungeon, beneath the five-story Mission at 14 East 79th Street, family members of 'troublesome' Iraqi citizens would be locked up to coerce their relatives back in Iraq.And even if they did somehow manage to break out, guard equipped with 9mm pistols and Kalashnikov rifles would be on hand to deal with the 'problem.'

Some would even be tortured by Hussein's sinister agents, the Mukhabarat, who would pull out fingernails and toenails, and hit them with hoses, planks and copper wire.

If anyone died in the dungeon - and they did, according to the official sources, who did not want to be named - their bodies would be smuggled out of the US.

"They just put [the body] in a diplomatic box and it can just be shipped," the source said.

"This is diplomatic - nobody has the authority to examine it or open it."

Mukhabarat agents would typically wait until the unwitting Iraqi citizen came to the building on typical business before dragging them down to the dungeon.

The officials also confirmed that Hussein's men had committed similar acts of violence in other countries.

"Mukhabarat does whatever the hell Mukhabarat needs to do," the official said. "They are the last people you ever wanted to meet during the Saddam era."

The basement also contained two other rooms: An office, and a communications center used to receive and send orders to and from Iraq.

Six years before the 'detention room' was built, Michael Bloomberg - then a 31-year-old general partner in a Wall Street investment bank - bought the house opposite, at 17 East 79th Street.

That meant he was frequently unwittingly stood just tens of feet away from imprisoned, tortured and terrified victims of Hussein's brutal regime.

Hussein's regime fell in 2003, one year into Bloomberg's 11-year tenure as mayor of New York, and the Mission was soon broken wide open by the Feds.

Arguing that the US was now in control of Iraq, the agents broke open the vaults and offices, seizing documents, computers and other information.

Now both Iraq and the Mission are under new management, and the 'detention room' is no more, having been refurbished as a kitchenette at a cost of around $120,000. It's not known whether dining guests are told about the room's former use.